http://dev.w3.org/2006/xbl2/#the-content-element
Assigning this to dglazkov because we need an answer about the select attribute—is it a simple selector?
First cut: The selector language is: tag-name? ("." class-name)? ("#" id)? - Same whitespace rules as CSS - Same matching rules as the CSS selector with the same text - Except empty string, which matches *
My suggestion would be a comma-separated list of compound selectors (http://www.w3.org/TR/2011/WD-selectors4-20110929/#structure), with certain exceptions (see http://dglazkov.github.com/component-model/Draft/content.html). A space-separated list might be more HTMLy than a comma-separated list, but may be easily confused with spaces as CSS descendant combinators.
Closing: We finally have <content> behind the flag.